Digital Asset Tiles

Algorithmic Stablecoin

A stablecoin whose value is maintained using smart contracts and algorithms, rather than direct collateral backing.

Relevance: Aims for price stability without reserves, but can be volatile and risky.

Asset-Backed Stablecoin

A stablecoin fully or partially backed by real-world assets like fiat, commodities, or crypto.

Relevance: Offers transparency and trust, popular for payments and remittances.

Blockchain

A decentralized ledger recording transactions across computers, ensuring data integrity and security.

Relevance: Foundation for digital assets, enabling transparency and trustless transactions.

Central Bank Digital Currency (CBDC)

A digital form of a country’s official currency, issued and regulated by its central bank.

Relevance: Government-backed digital money, could reshape monetary policy and banking.

Collateralization

Securing a digital asset or stablecoin by holding reserves to back its value.

Relevance: Key for maintaining trust and price stability in stablecoins.

Custody

Safekeeping of digital assets, often by specialized firms or platforms.

Relevance: Essential for institutional adoption and regulatory compliance.

Decentralized Finance (DeFi)

A blockchain-based financial ecosystem enabling peer-to-peer services without intermediaries.

Relevance: Uses stablecoins and digital assets for lending, trading, and yield.

Fiat-Collateralized Stablecoin

A stablecoin backed 1:1 by fiat reserves held in banks or custodians.

Relevance: Provides high price stability, used for trading and remittances.

Governance Token

A token granting holders voting rights over a blockchain protocol or DeFi project.

Relevance: Enables decentralized decision-making and protocol upgrades.

On-Chain / Off-Chain

Whether a transaction occurs directly on the blockchain (on-chain) or outside it (off-chain).

Relevance: On-chain is transparent and immutable; off-chain is faster and private.

Overcollateralization

Locking more collateral than the value of the issued stablecoin or loan.

Relevance: Used in DeFi to protect against volatility and ensure solvency.

Peg

A mechanism by which a stablecoin maintains its value relative to a reference asset.

Relevance: Essential for stablecoins to function as reliable stores of value.

Proof of Reserves

Verifying that a stablecoin issuer holds sufficient assets to back its tokens.

Relevance: Builds trust and transparency via audits or cryptographic proofs.

Programmable Money

Digital assets that can be programmed with smart contracts for automated transactions.

Relevance: Enables innovation in payments, escrow, and financial services.

Redemption

Exchanging stablecoins for their underlying collateral or fiat currency.

Relevance: Crucial for maintaining stablecoin price stability and user confidence.

Security Token

A digital asset representing ownership of a real-world asset and subject to securities regulations.

Relevance: Enables fractional ownership and global trading of traditional assets.

Smart Contract

Self-executing code on a blockchain that enforces the terms of an agreement.

Relevance: Powers DeFi, stablecoins, and digital asset applications.

Synthetic Asset

A blockchain-based asset that mimics the value of another asset using smart contracts and collateral.

Relevance: Lets users gain exposure to traditional assets without direct ownership.

Tokenization

Converting rights to an asset into a digital token on a blockchain.

Relevance: Enables fractional ownership, liquidity, and easier transfer of assets.

Utility Token

A digital asset providing access to a product or service within a blockchain ecosystem.

Relevance: Used for payments, governance, or platform features.

Volatility

The degree of variation in the price of a digital asset over time.

Relevance: Stablecoins minimize volatility, making them suitable for payments and savings.

Burn

Permanently removing tokens from circulation, often by sending to an irretrievable address.

Relevance: Used to decrease supply, maintain peg stability, or during redemption.

Commodity-Backed Stablecoin

A stablecoin pegged to the value of a physical commodity, such as gold or silver.

Relevance: Enables exposure to commodities without direct ownership (e.g., PAX Gold).

Cross-Chain

Technology or protocols enabling digital assets to move or interact across different blockchains.

Relevance: Essential for interoperability between stablecoins and digital assets.

Decentralized Autonomous Organization (DAO)

A blockchain-based organization governed by smart contracts and token holders, not centralized leadership.

Relevance: Used for decentralized governance (e.g., MakerDAO).

Demurrage

A fee or negative interest charged for holding a digital asset over time.

Relevance: Sometimes used in stablecoin designs to encourage spending.

Digital Asset

Any asset that exists in digital form and is recorded on a blockchain, including cryptocurrencies, tokens, and NFTs.

Relevance: Stablecoins are a subset of digital assets.

Fiat On-Ramp/Off-Ramp

Services or platforms allowing users to exchange fiat currency for digital assets (on-ramp) or vice versa (off-ramp).

Relevance: Critical for converting between stablecoins and traditional money.

Fungible Token

A digital asset where each unit is interchangeable and identical in value.

Relevance: Most stablecoins are fungible, enabling seamless transactions.

Gas Fees

Transaction fees paid to process and validate operations on a blockchain.

Relevance: Affect cost and speed of stablecoin transfers, especially on Ethereum.

Issuer

The entity or protocol responsible for creating and managing a stablecoin.

Relevance: Centralized issuers or decentralized protocols play key roles in trust.

KYC (Know Your Customer)

A regulatory process requiring users to verify their identity before accessing financial services.

Relevance: Required for compliance and anti-money laundering (AML).

Liquidity Pool

A collection of digital assets locked in a smart contract to facilitate decentralized trading and lending.

Relevance: Stablecoins are used in pools to provide stability and reduce slippage.

Market Capitalization

The total value of a digital asset, calculated by multiplying its price by the circulating supply.

Relevance: Indicates the scale and adoption of a stablecoin or digital asset.

Minting

The creation of new tokens, typically governed by smart contracts or the issuer.

Relevance: Stablecoins are minted when users deposit collateral or fiat.

Tokenized Deposit

A bank-issued stablecoin representing a claim on actual deposits, recorded on a blockchain.

Relevance: Bridges banking and digital assets, offering instant settlement and programmability.